Estate planning lawyers in Sacramento are in the business of helping their clients create the best financial strategy possible, not just for their heirs, but for themselves, as well. Setting yourself up for retirement or to simply live the lifestyle you want takes some effort, which is why so many people make the choice to work with an estate planning lawyer who knows the DOs and DON’Ts of putting together an effective route for success.
There’s a ton of information out there on what to do and what not to do, but a recent survey from Consumer Reports has offered a really good look into the most common financial mistakes that are made, potentially keeping people from creating their nest egg, protecting their assets, and so on.
Take a look at this list and make sure that you’re not falling into the same trap that so many others have. If you need some guidance and direction, talk to a reputable Sacramento estate planning attorney to turn things around before it’s too late.
The 7 Most Common Financial Mistakes
- Emergency fund – Building an emergency fund can seem overwhelming, but it is an important part of protecting what you have. Three to six month’s worth of living expenses set aside will make all the difference if you suddenly lose your job or are otherwise unable to earn your regular salary. The emergency fund will keep you from living off credit and starting that downward spiral.
- Credit Reports – Credit reports wield a lot of power, from what home you can buy to what job you can get. Unfortunately, they often include errors, and it’s up to you as a consumer to identify and fix the errors. You won’t know if someone else’s mistake is harming you unless you take the time to review your report. You can get your report for free once a year from each reporting agency. Go to AnnualCreditReport.com. This is the only truly free report site. Watch out for imposters.
- Reviewing the will (and trust) – If you’ve already made your will (or trust), then good for you! (If not, please work with us to get this important task off your to-do list!) Unfortunately, even those who are responsible enough to get their affairs in order this way often overlook the importance of reviewing the will. An annual review allows you to make revisions based on life changes, including updating your beneficiaries. Don’t forget to review the other important parts of your estate plan – your durable power of attorney and healthcare directive.
- Communicating with family – Once you’ve put together a plan with your Sacramento estate planning lawyer, it’s imperative to make sure your family knows how to access it when the time comes. Whether you’ve stashed it in a safe deposit box or kept it with a lawyer or trusted individual, you’ll want your family to be able to find it to carry out your wishes.
- 401(k) mishaps – Those who don’t remember to review their 401(k) plans can miss out on a lot of opportunities. You want to make sure that you’re making your contribution and that if your employer matches it, you’re taking advantage of that. As with the will, you will also want to occasionally update your beneficiaries.
- Homeowner’s insurance – Homeowner’s insurance can seem like an unnecessary expense, but if something catastrophic happens, it is your safety net. Imagine trying to replace everything you’ve worked so hard for with no funds to do so!
- Debt – Debt is a beast that scares people to the point of not even seeking the help of an estate planning attorney. Allowing it to get out of hand, however, can have a disastrous impact on your financial life.
Just because you’ve had trouble in any of these areas doesn’t mean that it can’t be fixed. A Sacramento estate planning attorney can help you develop a strategy for getting back on track.